TSMC sales up 85% in Q2 with better-than-expected results from acquired foundries

HSINCHU, Taiwan -- Taiwan Semiconductor Manufacturing Company Ltd. here today reported better-than-expected profits and higher shipments of foundry-processed wafers in the second quarter, partly due to the completion of acquisitions of Worldwide Semiconductor Manufacturing Corp. and TSMC-Acer Manufacturing Corp.

TSMC's net sales in the second quarter grew 85% from revenues in the same period last year and 12.5% sequentially from the first quarter 2000. Higher average selling prices for processed wafers and higher unit volumes pushed TSMC's net sales to NT$31.81 billion ($1.03 billion) from NT$17.23 billion ($555 million) in the second quarter of 1999. TSMC's first-quarter 2000 sales were NT$28.28 billion ($912 million).

The world's largest pure-play silicon foundry company said the integration of the two acquired foundry operations in the second quarter contributed to its results with higher-than-expected wafer volumes for customers. TSMC's gross profit grew to NT$13.75 billion ($444 million) vs. NT$7.92 million ($255 million) in the second quarter 1999.

TSMC said its unit shipments of 8-inch equivalent wafers grew 69% to a record 697,000 wafers in the second quarter vs. 413,000 in the period last year. Sequentially, the company's shipments were 8.5% higher in the second quarter from 642,000 wafers in the first three months of this year.

Officials at TSMC said the mergers of WSMC and TASMC went better than expected after the two acquisitions were announced nearly seven months ago. Fab 8 (a WSMC chip-processing plant) reached 77,000 eight-inch wafers in the second quarter, which is equivalent to its entire output last year. Fab 7 (the TASMC plant) processed 98,000 eight-inch wafers in the second quarter, according to TSMC.

The acquired capacity will enable TSMC to increase its foundry output by about 29% in 2001, according to company officials.

For the first time in over a year, TSMC is not planning significant increases in capital spending from previous targets. Capital spending for TSMC stands at $3.8 billion and $1.1 billion for its affiliates (providing foundry wafers) in 2000. Planned capacity also remains unchanged in 2000 at 3.4 million eight-inch equivalent wafers in 2000. TSMC's 2001 target has been slightly increased to 4.79 million wafers from a previous plan of 4.76 million eight-inch equivalent wafers.